Since the Brexit vote, the number of people working in two Goodfish Group factories has dropped by a third.
“12 months after the vote, we started to see a drop in work here for a Japanese customer of ours, based in the UK, who moved production to the Czech Republic pretty quickly. We saw a gradual decrease in that part of our business and we had to close it 18 months ago, “explains Greg McDonald, CEO of the GoodFish group.
European industry depends on the parts built being moved from factory to factory, without border obstacles and without being delayed by anything. Something that in the UK will stop when border controls start in January.
“It means that a manufacturer can get the parts they need only a day or two before they actually need to use them. If the ‘just-in-time’ approach were affected, we would probably see that manufacturers would have to spend a lot more on storage in order to work. If they do not have storage capacity, there could be a shortage and that impacts their production. Storage also involves a cost “, says Anna-Maria Baisden, director of Fitch Solutions.
And the added costs always make industry leaders rethink things.
Some large firms have already moved their tab
“Jaguar and Land Rover have gone to Slovakia and built a huge plant there. And finally I decided that Slovakia was the place to be because we could get to Poland, Czech Republic, Hungary, Romania very quickly. And we are ready. I have visited sites. And I’ve done everything I could. I’ll hit the button when the customer says: “We need this to be done on the other side of the Brexit curtain,” continues McDonald, who is convinced that sooner or later customers will They will ask you to produce within the European Union.
It is a decision that many leaders in this industry are now facing. If they are no longer connected to a seamless European supply chain; and they have to deal with the paperwork and delays when crossing the English Channel, so should they stay or should they go?
Recently, BMW said it would stop making electric motors at this factory near Birmingham and use it to build gasoline and diesel engines instead.; products that will be obsolete in the next 20 years.
Car factories are multi-million dollar investments. But as big decisions about future factories loom, a tough border is unlikely to count in the UK’s favor.